May 2, 2014
Japan may cut US beef tariffs to around 20%
As part of bilateral negotiations for a Pacific free trade pact, Japan is considering lowering its levies on US beef from 38.5% now to around 20%, Japanese government sources said.
Washington has called on Tokyo to cut its beef tariffs to below 10%, but is apparently leaning toward allowing Tokyo to keep higher tariffs as US President Barack Obama rushes to strike a deal before US midterm election in November.
As for beef trade, the focus is now on safeguard measures that Japan wants to introduce to restrict imports of US beef should they surge under the Trans-Pacific Partnership (TPP), the sources added.
As Japan and the US -- the two biggest economies among the 12 TPP negotiating nations -- are finding a way to move closer on the issue of beef, one of the biggest sticking points, TPP talks may enter a new phase at a ministerial meeting May 19-20 in Singapore, trade observers say.
Tokyo and Washington have been at odds over tariffs on five farm product categories that Japan designated as off-limits -- rice, wheat, beef and pork, dairy products and sugar -- as well as automotive issues.
Akira Amari, Japan''s minister in charge of the TPP, has said he may meet with US Trade Representative Michael Froman before that ministerial gathering. But problems on how to deal with Japanese tariffs on US pork have yet to be solved to secure a bilateral agreement, which is seen as vital to advance the broader 12-nation TPP negotiations.
The envisioned cut in beef tariffs is close to the figure recently agreed by Japan and Australia in their bilateral free trade deal, which some people within the Japanese government have called "the red line" to protect the domestic farm industry.
Under a broad agreement with Canberra, Tokyo will slash tariffs on Australian frozen beef, mainly used for processed food for restaurants, to 19.5% in 18 years and tariffs on chilled beef, sold in supermarkets, to 23.5% in 15 years.
Last week, Amari and Froman held around-the-clock talks on outstanding TPP issues before a summit between Obama and Japanese Prime Minister Shinzo Abe in Tokyo.
Though the leaders failed to announce a broad agreement at the summit, they said in a joint statement released the following day that the two sides "identified a path forward" on important issues and that marked "a key milestone" in the TPP negotiations.
The two sides, however, have yet to bridge considerable gaps over tariffs on pork and safeguard measures for beef imports. Talks on beef tariffs could face a setback again if they failed to make sufficient progress on other difficult issues, the sources said.
Prior to the planned ministerial meeting, the 12 countries are also expected to hold a chief negotiators'' meeting in Vietnam from May 12 to 15.